Sunday, January 17, 2016

Ford long term short 0 cost option play update




As you can see the position I discussed, for which I had a limit order to buy at $0.10, is trading for about $1.80 on 1/15/16 near the close. That's a 18x or 1,800% increase.

Only one problem I had with this. On 12/31/15, the day after I came up with this trade and posted it, the market opened with a value of $0.15 and climbed from there. So my $0.10 limit order never triggered and I missed the whole thing. I congratulate myself for my discipline in keeping with my plan, and I kick myself in the tush for not having a more generous buy limit. If I had gotten in at $0.15 that would still be a 1,500% return.

I'm embarrassed by how many times I had the right idea, or even a lucky idea, but lost out from the execution. The good news is execution is something that can be repeated, reviewed, and practiced and therefore improved.

If I was in this trade, I'd probably take profits, or take off at least 50% of the position, very soon because, as you can see on the chart, we're approaching the bottom of the channel, on very low stochastics, far from the 8ema, and after what might be a cathartic down volume move a couple days ago, which you can also see on the chart.

This was supposed to be a long term trade but we had this large fast move and a likely bounce is imminent. It seems like a good idea to take profits or partial profits now and get back in later.